business law

Director’s duties simply mean that directors shall act in accordance with honesty, diligence, and prudence. Besides that, director’s duties also include avoidance of conflict of interest. Thus, directors should state their intention in any of the transaction in which the company is involved besides following the instructions of the board of directors. Directors should also exercise caution and competence in all circumstances as a sensible person would react under the situation. Directors also should not make use of the information attained as a board of the directors. Fairness is also an important duty of directors whereby directors should deal with their fellow board of directors and shareholders without any favouritism. Directors should not get engaged in any of the conduct that may bring in disrespect to the company and also to the other directors is also one of the prominent duties of directors. Moreover, directors should also be independent and must not compromise on the rights to provide independent judgement. However, at the same time directors must restrict their independence in a good faith to make decision that would benefit the company.
Corporate opportunity factually explains that any business opportunity that could advantage a business (Law Cornell, 2010). Thus, corporate opportunity doctrine leads the legal duty of directors, officers and leading shareholders in a company, in the responsibility of loyalty, not to take any opportunity for their oneself deprived of first revealing the chance to the board of directors of the company also providing the board the opportunity to decline the opportunity on behalf of the corporation.
Therefore, if this process is interrupted, and a corporate fiduciary proceeds the corporate opportunity anyhow, then the fiduciary has been disrupted its duty of loyalty, and the company will be entitled to a constructive faith of all profits attained from the unlawful transaction.
Hence, according to director’s duty and